The Five-Year Offshore Leasing Plan
The U.S. Department of the Interior (DOI) recently announced its long-awaited Five-Year Offshore Leasing Plan as required by the Outer Continental Shelf Lands Act.
The plan calls for a maximum of three offshore oil and gas lease sales in the Gulf of Mexico in 2025, 2027, and 2029, with no lease sales scheduled for the Atlantic and Pacific Oceans, as well as Alaska. No lease sales will be held in 2024, making it the first year in the modern program’s four decades that companies will be unable to bid for parcels in the Gulf of Mexico or the waters off Alaska.
The DOI says that the reduction to a maximum of three potential lease sales will bring the federal offshore oil and gas program in line with the Biden-Harris administration’s goal of net-zero emissions by 2050. The DOI actually pointed out that the areas considered for leasing and the number of potential lease sales in the 2024-2029 Proposed Final Program have been significantly narrowed from the previous presidential administration’s original proposal of 47 lease sales off all coastal areas in the U.S. over a five-year period.
In announcing the plan, the Interior Department’s Bureau of Ocean Energy Management (BOEM) stated that the Plan included the minimum number of offshore oil and gas lease sales to enable BOEM “to continue to expand its offshore wind leasing program through 2030.” Oil industry leaders argue that more leasing is needed to sustain production in the Gulf of Mexico, home to about 15% of U.S. crude output. It can take years for companies to find and extract oil from newly sold tracts, which is why present-day leasing helps sustain production for decades to come.
This plan will not only hurt American production, but it also puts our energy security at risk and will result in hundreds of millions of dollars of lost revenue to coastal states and the federal treasury. It will force the U.S. to get oil from other nations rather than develop American resources by American companies.
A 60-day clock before the Interior can formally approve the Proposed Final Program started running when it was formally published on 2 October.